The Telwar Company has just gone public. Under a firm commitment agreement, the company received $25.11 for each of the 30 million shares sold. The initial offering price was $27 per share, and the stock rose to $32.49 per share in the first few minutes of trading. The company paid $1.4 million in legal and other direct costs and $375,000 in indirect costs. What was the flotation cost as a percentage of funds raised? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Flotation costs %

The Telwar Company has just gone public. Under a firm commitment agreement, the company received $25.11 for each of the 30 million shares sold. The initial offering price was $27 per share, and the stock rose to $32.49 per share in the first few minutes of trading. The company paid $1.4 million in legal and other direct costs and $375,000 in indirect costs. What was the flotation cost as a percentage of funds raised? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Flotation costs %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Nougat Corporation wants to raise $4.9 million via a rights offering. The company currently has 550,000 shares of common stock outstanding that sell for $50 per share. Its underwriter has set a subscription price of $25 per share and will charge the company a spread of 5 percent. If you currently own 3,000 shares of stock in the company and decide not to participate in the rights offering, how much money can you get by selling your rights? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) I keep getting the wrong answer, I get $2,430 and its not correct, the answer 20130 is also not correct, and the answer 20459.29 is also not correct
LYFT IPO was issued at $72/share. Before the IPO, Lyft had 240 million class A shares outstanding and wanted to issue additional 30 million class A shares. On top of that, Lyft gave its underwriters options to purchase another 5 million shares at $72 each. When Lyft stock price fell below the IPO price of $72, to support the stock price, up to how many shares the underwriters could buy from the open market without losing money? 5 million shares 30 million shares 35 million shares 240 million shares 275 million shares
Prahm Corp. wants to raise $4.7 million via a rights offering. The company currently has 530,000 shares of common stock outstanding that sell for $55 per share. Its underwriter has set a subscription price of $30 per share and will charge the company a spread of 6 percent. If you currently own 5,000 shares of stock in the company and decide not to participate in the rights offering, how much money can you get by selling your rights? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Sale proceeds
A firm goes public. The firm receives $38 for each of the 4.5 million shares sold. The initial offering price was $40.25 per share, and the stock rose to $43.15 per share is the first few minutes of trading. The firm paid $2,485,000 in direct legal and other costs and $665,800 in indirect cost. What were the total direct cost of this offer?
Jenny Corporation needs to raise $46 million to fund a new project. The company will sell shares at a price of $27.60 in a general cash offer and the company's underwriters will charge a spread of 6.5 percent. The direct flotation costs associated with the issue are $575,000. How many shares need to be sold? Multiple Choice 1,666,667 shares 1,804,813 shares 1,735,740 shares 1,564,945 shares 1,615,806 shares
Hoobastink Mfg. is considering a rights offer. The company has determined that the ex- rights price will be $61. The current price is $68 per share, and there are 10 million shares outstanding. The rights offer would raise a total of $60 million. What is the subscription price?
Pardon Me, Inc., recently issued new securities to finance a new TV show. The project cost $14.7 million, and the company paid $795,000 in flotation costs. In addition, the equity issued had a flotation cost of 7.7 percent of the amount raised, whereas the debt issued had a flotation cost of 3.7 percent of the amount raised. If the company issued new securities in the same proportion as its target capital structure, what is the company’s target debt−equity ratio?
5
In the IPO, the firm issued 3,000,000 new shares. The initial price was $18.00/share with investment bankers retaining $1.26 as fees. The final first-day closing price was $23.50. 1. What were the total proceeds from this offering
Myers Inc. currently has 5, 750,000 shares outstanding, and they trade at a price of $23.76. They need to raise $35,000,000 in new funding, and will execute a Rights Offering at a subscription price of $18.00 per share. At the current share price, what will be the price of one Right leading up to the subscription? Group of answer choices $3.04 $1.46 $1.74 $22.30 $2.96

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